[PBAT Daily Review] Supply And Demand Weaken, Transactions Are Flat, Market Consolidates Steadily

1. Today’s Summary

1. Domestic PBAT spot prices remained stable across all regions, with mainstream quotations in East China and South China holding steady. Raw material prices showed divergent trends, and overall cost support remained relatively weak.

The industry production operation is stable, with the PBAT capacity utilization rate remaining at 23.43%. Leading enterprises are moderately maintaining production loads, while most facilities continue to be in a, resulting in a relatively loose overall supply of goods.

Downstream demand remained sluggish, and although operating rates in the biodegradable film bag industry edged up slightly, they were still at a low level overall. Terminal restocking was mainly driven by rigid demand, new order transactions were weak, export follow-up slowed, and bearish sentiment continued to dominate the market.

4. Weekly data are expected to be relatively loose. Industry capacity utilization, output, and inventories are all rising simultaneously, and the loose supply-demand pattern is expected to continue. In the short term, the market lacks upward drivers and is likely to remain in a range-bound consolidation phase.

II. Spot Overview

(I) Spot prices remained stable.

Today, the domestic PBAT market price remained stable overall, with mainstream spot prices in East and South China reported at 11,550 yuan/ton, showing no fluctuations throughout the day. The overall market volatility was minimal. Supply of spot goods in the market was ample, with leading brand companies maintaining stable deliveries, primarily focusing on fulfilling orders from existing customers. The sales pace for high-priced goods was relatively slow, and the expansion of new orders and bulk transactions was limited.

The downstream demand support is weak, and the operating level of the biodegradable film bag products industry is generally low. Terminal companies are cautious in procurement, mainly sourcing low-priced goods and making small orders for essential stock replenishment. At the same time, PBAT export orders are slowing down, and the bargaining power of downstream buyers is increasing, further suppressing the spot transaction focus. Overall, the market trading atmosphere is dull, with no concentrated volume growth.

(II) Diverging Price Trends in Upstream Raw Materials

Today, the three main raw materials for PBAT showed divergent trends, with mixed bullish and bearish signals on the cost side. Bulk BDO prices edged down slightly, with the mainstream East China quotation falling by RMB 25 to RMB 7,700/ton, reflecting a cautious and weak market sentiment. Adipic acid moved higher against the trend, rising by RMB 150 to RMB 7,950/ton, as suppliers showed a strong willingness to support prices. PTA prices dropped sharply, falling by RMB 275 in a single day to RMB 6,250/ton, marking a significant decline. Overall, gains and losses among the raw materials largely offset each other, with no clear increase or decrease in overall costs, providing limited guidance for PBAT spot prices. The market therefore remained stable within a range.

III. Production Dynamics

Today, the domestic PBAT industry is operating steadily, with a capacity utilization rate of 23.43%, unchanged from the previous period. There is a clear differentiation in the operation of industry facilities: Wanhua Chemical, Zhejiang Huafeng, Hubei Yihua, and Gansu Mogaohua each maintain one production line in operation, Xinjiang Lanshan Tunhe has started two production lines, and Zhuhai Jinfan continues to operate three production lines, consisting of two large and one small. Most other companies have their facilities continuously shut down, and the overall operating load of the industry remains at a low level.

Overall supply remains relatively ample, with operating producers maintaining stable production and steady shipments. Coupled with insufficient follow-through in downstream demand, producers’ shipment pressure has gradually become apparent, spot inventory destocking has been slow, and the market as a whole shows a pattern of supply slightly exceeding demand. This week, the operating rate of biodegradable film and bag producers was 37.4%, up slightly by 0.8 percentage points week on week, but the improvement in demand remained limited, making it difficult to effectively digest existing supply.

IV. Market Sentiment

Current industry market sentiment is pessimistic, with a clear divergence in expectations among practitioners. Survey data shows that bearish views account for as high as 67%, with the market generally worried about continuously weak demand and a loose supply suppressing the market. Those maintaining a neutral outlook account for 33%, with most industry players believing that cost factors provide some support, limiting the potential for significant declines. There is currently no bullish sentiment, and overall market confidence in going long is insufficient, making it difficult for a trend rebound in the short term.

V. Price Prediction

1. Short-term Market Forecast

Considering supply and demand, costs, and market sentiment, the domestic PBAT market is expected to continue in the short term.Narrow-range oscillation, weak consolidationtrend.

Suppressing factors: Demand for downstream degraded products is sluggish, end-user rigid demand follows weakly, export orders continue to slow, and market transactions are difficult to expand in volume; overall industry supply remains ample, operating enterprises are facing poor shipment conditions, and inventories are slowly accumulating; bearish market sentiment is strong, traders are trading cautiously, and high-price transactions are under pressure.

Supporting factors: Firm adipic acid prices on the feedstock side provide cost support, and there is currently no significant risk of a sharp collapse in overall costs; low industry operating rates limit any substantial increase in supply; after continuous market adjustments, price support at the bottom is relatively solid.

2. Price Range

Expected short-term mainstream operating range for domestic PBAT11,300–11,800 yuan/tonThe market average price remains around 11,550 yuan/ton, mainly fluctuating within a narrow range throughout the day, with no clear upward or downward trend.

3. Risk Warning

If the raw material side collectively strengthens significantly, it may drive PBAT prices to make a slight upward correction; if downstream production continues to recover and export orders are released in large quantities, the market is expected to stabilize and strengthen. Conversely, if demand remains sluggish and inventory continues to accumulate, there is a risk of a slight downward adjustment in prices. This analysis is merely a fundamental projection and does not constitute any trading or investment advice.

6. Data Outlook

The core industry data set to be released this week is broadly expected to be loose. PBAT plant operating rates and weekly output are likely to edge higher, while industry inventories are also expected to build, further extending the loose supply-demand pattern. In the short term, there is unlikely to be any substantial improvement in market fundamentals.